Date: October 2, 1994

Published: New York Times, Business Section, page 4

Labour Secretary Robert Reich advocates a dangerous doctrine when he recommends that pension
fund managers intervene in the management of the companies in whcih they invest
("A moral workout
for Big Money," Viewpoints, Septmber 11). If there is one thing that we know
from the management research of the last decade, it is that concerns that
that diversify into unrelated industries do a lot worse than than those that
focus on core businesses.

Pension fund manages are very good at managing money. They should stick to
that and allow company managers get on with managing the businesses. If they
don't like what is happening they should vote with their feet and sell the
investment. They should not imagine that they have much to offer in terms
of managing the range of busineses in which they invest. Too much power for
the pension managers will merely return us to the years of the conglomerate.
Those corporate dinosaurs that survived are now divesting rapidly to return
to their core businesses.

Martin G. Evans, Toronto

September 14

The writer is a professor of organizational behavior at the University of Toronto